One other clarification for you, many floating-rate lending agreements actually allow for the borrower to select between the Fed rate and LIBOR throughout the t

One other clarification for you, many floating-rate lending agreements actually allow for the borrower to select between the Fed rate and LIBOR throughout the term of the agreement. As I understand, the prevalence of LIBOR in US contracts at least somewhat coincided with the increased globalization of US business as, from a risk management perspective, sometimes you may want the interest rate on your borrowings to reflect a different economic sentiment than just the US. Clearly, once LIBOR started being manipulated by the bankers, it no longer accurately reflected the market it was supposed to represent, but its not always about having the most "accurate" rate, but aligning/managing your risk appropriately.